King Trade Capital announced the recent funding of a $1,200,000 million purchase order finance facility for a California-based home furnishings and textile company.

Thursday, May 28, 2015

King Trade Capital was contacted by the special situations group of a national asset-based finance company to discuss a unique opportunity to help an existing client return to growth, but first they needed to rehabilitate their credit with overseas suppliers. The client of the asset-based lender (“ABL”) was interested in improving key relationships with its international suppliers especially those that stood by the company in a recent restructuring. The prospect did not have sufficient open credit from the vendors nor did they have availability under their asset-based facility to support the amount of presold inventory required to fulfill a growing order book. While the asset-based finance company was comfortable in lending against inventory located in the U.S. warehouse, it sought out King Trade Capital for its expertise in funding international inventory purchases which included properly structuring the financing of in-transit inventory.

King Trade Capital quickly worked in conjunction with the company and ABL to come up with a finance solution. The solution entailed providing LCs (letters of credit) which provides credit enhancement when dealing with overseas suppliers. No longer were deposits required by overseas suppliers as a result of receiving LCs, the suppliers were now assured that they would be paid upon shipment. In addition, the overseas suppliers had the ability to obtain a packing credit /pre-export finance from their banks based on the LC that backed our client’s orders.

King Trade Capital previously established an inter-creditor agreement with the ABL as a result of two prior successful joint client relationships. The company now has multiple finance partners working together to help achieve a common goal, fulfilling and supporting future sales growth while improving credit standing with its overseas suppliers

King Trade Capital’s experience in providing import finance solutions along with incremental capital benefitted the company, its ABL and the overseas suppliers that can produce and ship knowing it will be paid on a timely basis. Most importantly, it allows the client to accept orders from new and existing customers that can confidently increase the volume of orders to the company knowing it has the capability to fulfill them.

King Trade Capital is the country’s oldest and largest independent purchase order, trade, and contract finance provider for small to middle-market companies in the U.S., UK and Canada. Since 1993, King Trade Capital has provided almost $2 billion of capital to over 350 public and private companies worldwide.